First in Victoria University Debating Society 2009 series of public debates on topical public policy issues. (Rutherford House, 6.30pm, 11 May 2009)
Third affirmative speaker Don Franks
Unfortunately capitalism is not on its deathbed, but it is in a state of crisis. You don’t have to take the word of a communist union organiser – just listen to the despairing of senior capitalist mouthpieces.
“Our world is broken—and I honestly don’t know what is going to replace it. The compass by which we steered as Americans has gone. The last time I saw anything like this, in the sense of disorientation and loss, was among my Russian friends when the Soviet Union broke up.” So said Bernie Sucher, Merrill Lynch operations head in Moscow, in the March 8th Financial Times.
In the same edition of the Financial Times Associate editor and chief economics commentator Martin Wolf despaired: “It is impossible at such a turning point to know where we are going… Yet the combination of financial collapse with a huge recession, if not something worse, will surely change the world. The legitimacy of the market will weaken. The credibility of the US will be damaged. The authority of China will rise. Globalization itself may founder. This is a time of upheaval.”
In the midst of this time of upheaval, Wolf continued clinging to the old capitalist mantra: “no credible alternative to the market economy exists…”
It is a well known habit of ruling classes to declare their own particular social formation immutable. Before Martin Wolf’s fellow capitalists came to hold sway, feudal lords believed their regime to be ordained for all time by God .
In fact the market economy form of production and distribution is relatively historically recent. Since our evolution into humans, most of our production has been for direct consumption by the producers.
Small scale commodity production has existed for several thousand years.
But only in the last couple of centuries has commodity production become the earth’s dominant form of creating goods and services. Capitalism is not the most enduring form of human society; neither is it the most logical, natural, efficient or humane.
Individual capitalists generally drive their workers to produce the maximum without regard to the capacity of the market to absorb their production, or to any negative social, economic or environmental effects. The result is a system with built in inescapable periodic crises. Competition between countries in the world market make it ever more difficult for them to sell the goods which are produced in ever-increasing quantities. Intense competition among capitalists makes it necessary to keep investing in plant and machinery. Relatively greater proportions of capital are invested as constant capital, which merely reproduces its own value, and relatively less as variable capital, which is spent on labour-power, the one commodity which creates new expanded value. This leads to the tendency of the rate of profit to fall, described by Marx as “the single most important law of modern political economy.” The effects of falling profitability can be seen in capitalists’ inability to generate a new round of economic growth on the scale of the post-war boom.
Modern capitalism has been in a state of chronic slump for several decades. Long periods of recession have been punctuated by shallow, short-lived booms termed ‘jobless recoveries’ because they generally don’t restore employment. The result is a crisis. Workers’ rights and living standards are attacked and the price of labour-power is driven down; capitalists less able to compete are driven to the wall and their business go bust, with their workers thrown on the scrap-heap; goods are unable to be sold even though people want and need them.
Or, as the old union song puts it:
“now we stand outcast and starving midst the wonders we have made”
The latest edition of the Maritime Union of New Zealand magazine The Maritimes features an article titled “We won’t pay for their crisis” The section ‘effects on workers’ notes:
“The USA jobless rate will reach 9.4% this year according to a survey from the business website Bloomberg News. The USA has already lost 4.4million jobs since December 2007”.
“A national business organisation predicts UK unemployment will hit 3.2 million people as the economy shrinks - over 1 in 10 people. Official unemployment figures are rising and currently stand at 2 million.”
“ The UN puts the average unemployment rate as 15 % in the Arab world, reaching 40% among people between the ages of 15 and 24- a total of 66 million out of the total Arab population of 317 million.”
“The IMF expects global unemployment to hit 50 million.”
For working people capitalism is a cruel denial of their human potential.
In my own working lifetime I’ve seen things get not better but worse. Since I began working there has come to be for workers, a dirtier deal. More casualisation, lower union density, greater inequality, lower job safety standards, worse housing, greater state and employer surveillance, fewer social services and a far more bleak and uncertain future for our children.
Labour and National governments have made no difference – why would they – the problem is not governments but the capitalist system.
Capitalism is a system of privilege, injustice and crisis.
There is no better way to spend one’s life than taking part in the destruction of capitalism and its replacement with socialism. The Workers Party is seriously committed to help accomplish this task and I invite all people of goodwill here tonight to join us. If you are interested, please see me after the conclusion of this debate,